NEW YORK -- Wall Street was mixed in choppy trading Friday as investors pocketed profits and braced for a slew of earnings next week. The Nasdaq composite index ticked higher for the day, but a blue chip sell-off snapped an eight-week winning streak for the Dow Jones industrial average.
Analysts were not overly concerned about the day's losses. Strong corporate earnings, low interest rates, good housing numbers and an improving jobs picture have got 2004 off to a very good start, said Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee.
"I don't think this is bad news," Berman said. "You wouldn't expect the market to go up nonstop."
The Dow closed down 54.89, or 0.5 percent, at 10,568.29, for a weekly loss of 0.3 percent.
The Nasdaq closed up 4.86, or 0.2 percent, at 2,123.87, but was down 0.8 percent for the week after six straight weeks of gains.
The Standard & Poor's 500 index closed down 2.39, or 0.2 percent, at 1,141.55, but was 0.1 percent higher for the week - its ninth weekly advance in a row.
After so many weeks of gains, and halfway through a highly anticipated earnings season, there was growing concern that shares were overvalued. Most analysts remained upbeat about market for the long-term, however. More than 100 companies in the S&P 500 are expected to report results next week.
"In weeks like this you have to take a holistic view of the market, and not get too shook up about one stock being down a couple percent on what should be perceived as a good earnings announcement," said John C. Forelli, portfolio manager for Independence Investment LLC in Boston.
Overall, profits are expected to be 20 percent higher than last year, but many of these gains may already be reflected in stock prices. Still, the news has been generally good, said Susan L. Malley, chief investment officer for Malley Associates Capital Management.
"There are places in the market where things are overvalued but there are still places where they're not, and we're still finding things to buy," Malley said. "I'm not concerned about this modest pullback. ... If we didn't get a little bit of a rest like this, I'd be more concerned."
Malley said her firm has favored basic materials, which stands to benefit with rising demand from China, as well as energy and industrials, two sectors that typically do well when the economy is accelerating.
"We still think tech will do well, though," she added. "We still have a chunk in tech and a chunk in finance."
Tech bellwether Microsoft closed up 47 cents at $28.48 after several brokerage firms issued positive comments about its quarterly results, released late Thursday. The software company's earnings beat expectations as stronger demand for personal computers helped boost sales, and the company raised its forecast for the year.
Eastman Kodak Co. lost $1.07 to $29.88 after gaining 13 percent Thursday on high hopes for its restructuring plan. Kodak, which beat expectations for the quarter, is shifting its focus from traditional film to the digital photography market, and plans to cut up to 15,000 jobs this year.
Shares of Regions Financial Corp. and Union Planters Corp. rose sharply after the banks announced plans to merge. Regions closed up $2.00 at $39.75, while Union Planters gained $1.31 to $32.67.
Energy stocks were also among the gainers, led by oil services company Schlumberger Ltd., which rose $4.19, or 7.5 percent, to $59.77. Its earnings beat analyst expectations, and it reported a rise in revenues.
McKesson Corp. closed down $2.18 at $29.30 after reporting earnings that missed analysts' estimates. The health care supply management company said drug price changes hurt profits in its pharmacy outsourcing business.
Advancers outnumbered decliners about 7 to 6 on the New York Stock Exchange. Volume was moderate, with 1.54 billion shares traded, compared with 1.70 billion shares Thursday.
The Russell 2000 index, which tracks smaller company stocks, closed up 4.41, or 0.8 percent, at 596.14.
Overseas, Japan's Nikkei stock average finished 0.6 percent higher Friday. France's CAC-40 closed down 0.1 percent, Britain's FTSE 100 finished down 0.4 percent and Germany's DAX index gained 0.3 percent.
Both the Dow Jones Industrial average and the Nasdaq composite index posted losses for the week as investors collected profits and sent stocks lower.
The Dow had gained for eight straight weeks, and the Nasdaq had been up for six weeks. Only the Standard & Poor's 500 index gained for the week, it's ninth straight rise.
The Dow closed down 54.89, or 0.5 percent, at 10,568.29.
The Nasdaq composite index gained 4.86, or 0.2 percent, to 2,123.87.
The Standard & Poor's 500 index fell 2.39, or 0.2 percent, to 1,141.55.
For the week:
The Dow lost 32.22, or 0.3 percent. The Nasdaq was down 16.59, or 0.8 percent, while the S&P gained 1.72, or 0.2 percent.
Where the indexes stand compared with Oct. 9, 2002, when the Dow, S&P and Nasdaq hit five- and six-year lows, the depths of the bear market:
The Dow is 3,282.02, or 45 percent, above its five-year low of 7,286.27.
The Nasdaq is 1,009.76, or 90.6 percent, above its six-year low of 1,114.11.
The S&P is 364.79, or 47 percent, above its six-year low of 776.76.
Where the indexes stand compared with their all-time highs, reached in early 2000:
The Dow is 1,154.69, or 9.9 percent, below its peak of 11,722.98 on Jan. 14, 2000.
The Nasdaq is 2,924.75, or 57.9 percent, below its peak of 5,048.62 on March 10, 2000.
The S&P is 385.91, or 25.3 percent, below its peak of 1,527.46 on March 24, 2000.
So far in 2004:
The Dow is up 114.37, or 1.1 percent.
The Nasdaq is up 120.50, or 6.0 percent.
The S&P is up 29.63, or 2.7 percent.
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